1

IN THE DISTRICT COURT OF APPEAL

FIRST DISTRICT, STATE OF FLORIDA

O.F. NELSON & SONS

NURSERY, INC.,

Appellant,

v. CASE NO.: 1D19-2714

DOH CASE NO.: 2019-

0075

DEPARTMENT OF HEALTH,

Appellee.

_________________________________/

APPEAL OF FINAL ORDER DISMISSING PETITION FOR FORMAL

ADMINISTRATIVE HEARING

APPELLEE’S ANSWER BRIEF

SARAH YOUNG HODGES

Chief Appellate Counsel

Florida Bar No. 100448

Florida Department of Health

4052 Bald Cypress Way, Bin #C-65

Tallahassee, FL 32399-3265

(850) 354-3367

(850) 245-4662 (fax)

Sarah.Hodges2@flhealth.gov

mqa.psuappeals@flhealth.gov

Counsel for Appellee

Filing # 103976157 E-Filed 02/26/2020 05:38:54 PM

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TABLE OF CONTENTS

PAGE (S)

TABLE OF CITATIONS .......................................................................................... 4

STATEMENT OF THE CASE AND FACTS ......................................................... 7

SUMMARY OF THE ARGUMENT ...................................................................... 15

ARGUMENT ......................................................................................................... 17

I. The Department properly dismissed the Appellant’s

Petition for Formal Administrative Hearing. ...................................... 17

A. Standard of Review………………………………………...…17

B. Merits…..……………………………………………………..18

i. Default licensure is not applicable to the circumstances

in this case…...………………..………………………..18

a. Chapter 120 does not apply to constitutional

claims……….…………………………………..19

b. The deemer provision does not apply to licenses

awarded based upon need………………………20

c. Courts have not granted licenses under the deemer

provision where public safety could be harmed.

…………………………...……………………..22

d. Even if chapter 120 applied, there was no window

open for the acceptance of applications for MMTC

licensure ……………………………………….24

ii. The appropriate means of compelling compliance with

the Amendment is through judicial review rather than

administrative agency action. …………………………27

iii. A writ of mandamus is an inappropriate remedy in this

case…………………………………………………….28

CONCLUSION ....................................................................................................... 32

3

CERTIFICATE OF SERVICE ................................................................................ 33

CERTIFICATE OF FONT COMPLIANCE ........................................................... 34

4

TABLE OF CITATIONS

CASES PAGE(S)

Ashbacker Radio Corp. v. F.C.C.,

326 U.S. 327 (1945) .................................................................................... 20, 21, 22

Bennett v. St. Vincent's Medical Center, Inc.,

71 So. 3d 828 (Fla. 2011) ........................................................................................ 17

Bio-Medical Applications of Clearwater, Inc. v. Department of Health &

Rehabilitative Services,

370 So. 2d 19 (Fla. 2d DCA 1979).............................................................. 20, 21, 22

Decker v. University of West Florida,

85 So. 3d 571 (Fla. 1st DCA 2012) ........................................................................ 19

Department of Health v. Florigrown,

Case No. 1D18-4471 (Fla. 1st DCA 2019) ............................................................. 11

Department of Health v. Florigrown,

Case No. SC19-1464 (Fla. 2019) ............................................................................ 11

Diaz v. Jones,

215 So. 3d 121 (Fla. 1st DCA 2017). ..................................................................... 25

Edward Miller & Son, Inc. v. Department of Health,

Case No. 2016-CA-0700 (Leon Cty. Cir. Ct. 2019) ....................................... 12 n. 3

El Conuco Nursery v. Department of Health,

Case No. 2018-CA-275 (Leon Cty. Ct. 2018) ........................................................ 31

Florida Agency for Health Care Administration. v. Zuckerman Spaeder, LLP,

221 So. 3d 1260 (Fla. 1st DCA 2017) .............................................................. 29, 31

Florida League of Cities v. Smith,

607 So. 2d 397 (Fla. 1992) ..................................................................................... 30

5

Florigrown, LLC, et al. v. Florida Department of Health, Office of Marijuana Use, et

al.,

Case No. 2017-CA-2549 (Leon Cty. Cir. Ct. 2017) ............................................... 11

Gulf Pines Memorial Park, Inc., v. Oakland Memorial Park, Inc.,

361 So. 2d 695 (Fla. 1978) ...................................................................................... 28

Hatten v. State,

561 So. 2d 562 (Fla.1990) ..................................................................................... 30

Johnson v. Board of Architecture & Interior Design, Department of Business &

Professional Regulation,

634 So. 2d 666 (Fla. 1st DCA 1994) ....................................................................... 23

Key Haven Associated Enterprises, Inc. v. Board of Trustees of Internal Importer

Trust Fund,

427 So. 2d 153 (Fla. 1982) ........................................................................... 27-28, 31

Krakow v. Department of Professional Regulation, Board of Chiropractic Medicine,

586 So. 2d 1271 (Fla. 1st DCA 1991) ................................................................ 23-24

Louis Del Favero Orchids, Inc. v. Department of Health,

Case No. 18-2838RP (DOAH August 6, 2018). ....................................... 11 n. 2, 26

Mecca Farms, Inc. v. Department of Health, Louis Del Favero Orchids, Inc.,

Case No. 1D18-3761 (Fla. 1st DCA 2019). .................................................... 11 n. 2

Naples Community Hospital, Inc. v. Department of Health and Rehabilitative

Services,

463 So. 2d 375 (Fla. 1st DCA 1985). ..................................................................... 22

Rosenzweig v. Department of Transportation,

979 So. 2d 1050 (Fla. 1st DCA 2008) ..................................................................... 17

West Florida Regional Medical Center, Inc. v. See,

79 So. 3d 1 (Fla. 2012) ............................................................................................ 17

World Bank v. Lewis,

425 So. 2d 77 (Fla. 1st DCA 1982) ......................................................................... 24

CONSTITUTIONAL PROVISIONS

6

Article X, Section 29, Florida Constitution ................................. 8, 10, 13, 19, 27, 29

CONSTITUTIONAL REGULATIONS

Constitutional Regulation 2-1.01 ................................................................ 10, 24, 25

STATUTORY PROVISIONS PAGE(S)

Chapter 120, Florida Statutes ............................ 15, 18, 19, 20, 24, 26, 27, 28, 29, 30

Section 120.52, Florida Statutes .............................................................................. 19

Section 120.569, Florida Statutes ................................................................ 18, 26, 27

Section 120.60, Florida Statutes .................................... 12, 15, 17, 18, 19, 23, 25, 27

Section 120.68, Florida Statutes .............................................................................. 17

Section 381.986, Florida Statutes ........................................ 7, 8, 9, 11, 13, 20, 21, 29

RULES PAGE(S)

Fla. Admin. Code R. 64-4 .................................................... 7, 11, 11 n. 2, 12, 13, 26

Fla. Admin. Code R. 64ER17-2 .......................................................................... 9, 25

7

STATEMENT OF THE CASE AND FACTS

This is one of a number of administrative appeals brought by various entities

that sought licensure as Medical Marijuana Treatment Centers (MMTCs) despite the

fact the application window for licensure was not yet open and the “applications”

submitted did not comply with Department rules.

I. Overview of the State of Florida’s Authority to establish Medical

Marijuana Treatment Centers (MMTCs).

In 2014, the Florida Legislature enacted the Compassionate Use Medical

Cannabis Act, legalizing the use of low-THC cannabis for medicinal purposes to a

small group of qualified persons. Section 381.986, Florida Statutes (2014),

mandated that the Appellee, the Department of Health (the Department), authorize

the establishment of five dispensing organizations (DOs), one in each of the five

regions. § 381.986(5)(b), Fla. Stat. (2014). To successfully secure the sole DO

license in a region, an applicant was required to demonstrate that, among all

applicants for a given region, it was the most dependable and most qualified

applicant based on the criteria provided in the statute. Id.; Fla. Admin. Code R. 64-4

(2015). On November 23, 2015, pursuant to section 381.986 and Rule 64-4 of the

Florida Administrative Code, the applicant with the highest aggregate score in each

region was selected as the region’s DO.

On March 25, 2016, the Legislature adopted chapter 2016-123, section 3,

Laws of Florida, which provided another avenue for DO licensure for those

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applicants that met specific statutory requirements. A license was awarded to an

additional applicant.

On November 8, 2016, Florida’s electorate approved Amendment 2, which

expanded the class of persons eligible for medical use of marijuana in Florida and

directed the Department to issue reasonable regulations for the implementation and

enforcement of the Amendment. Art. X, § 29(d), Fla. Const. Specifically, the

Amendment provides that the Department shall promulgate “[p]rocedures for the

issuance, renewal, suspension and revocation of registration [of MMTCs], and

standards to ensure proper security, record keeping, testing, labeling, inspection, and

safety.” Art. X, § 29(d)(1)c., Fla. Const. Section 29(d)(3) further provides that if the

Department did not begin registering MMTCs by October 2017, “any Florida citizen

shall have standing to seek judicial relief to compel compliance with the

Department’s constitutional duties.” Art. X, § 29(e), Fla. Const. Finally, the

Amendment expressly clarifies that “[n]othing in [the Amendment] shall limit the

legislature from enacting laws consistent with this section.” Id. § 29(e). The

Amendment went into effect on January 3, 2017.

In light of article X, section 29(e), the Florida Legislature enacted Senate Bill

No. 8-A, which was described as “an act relating to the medical use of marijuana,”

and was codified at section 381.986, Florida Statutes (2017). The amended statute

provides for the registration of additional MMTCs, regardless of their region.

§ 381.986(8)(a)1.-2., 4., Fla. Stat. Under the 2017 law, the Department was required

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to license as MMTCs DOs that held an “active, unrestricted license to cultivate,

process, transport, and dispense low-THC cannabis, medical cannabis, and cannabis

delivery devices” under the former version of the statute, and met the other

requirements of the statute. § 381.986(8)(a)1., Fla. Stat. (2017). The Department

was also required to license as MMTCs those applicants for DO licensure that had

been denied a DO license, and either had one or more administrative or judicial

challenges pending or had a final ranking within one point of the highest final

ranking in its region, and met the other requirements of the section. See

§ 381.986(8)(a)2, Fla. Stat. (2017).

The amended statute provided for the registration of 17 MMTCs in the entire

state, with a rolling expansion provision providing that within six months of each

additional 100,000 active qualified patients registering with the Department another

four MMTC licenses becomes available. § 381.986(8)(a)1.-2., 4, Fla. Stat (2017).

On September 19, 2017, and pursuant to chapter 2017-232, section 14(1),

Laws of Florida, the Department issued the Notice of Emergency Rule entitled

Application for Registration of Medical Marijuana Treatment Centers. Fla. Admin.

Code R. 64ER17-2 (9/19/2017). The Emergency Rule incorporated Form DH8013-

OMMU-08/2017 (“Application for Medical Marijuana Treatment Center

Registration” or “Application Form”) and the requirements for the application for

registration of MMTCs. Id. (1). Applicants were required to include with the

application a non-refundable application fee of $60,830.00, written documentation

10

from the Department of State or the Department of Revenue showing that the

applicant had been registered to do business in Florida for the prior five consecutive

years and that the applicant possessed a valid certificate of registration from the

Department of Agriculture and Consumer Services, and a list of the owners, officers,

board members, and managers. Id. (1)(a), (b), (c). If an applicant failed to provide

any of these requirements, the application would be denied. Id. at (3).

On November 1, 2017, pursuant to article X, section 29(d) of the Florida

Constitution, the Department published Constitutional Regulation 2-1.01

“Application for Registration of Medical Marijuana Treatment Centers.”1 The

Constitutional Regulation also incorporated the Application Form by reference.

Both the Emergency Rule and the Constitutional Regulation state:

(4) The department shall publish in the Florida Administrative Register

and on its website the date upon which the department will begin

accepting applications and the deadline to receive all applications.

Applications and all required exhibits and supporting documents shall

be hand delivered to the Department of Health at 4052 Bald Cypress

Way in Tallahassee, Florida, during normal business hours, but no

earlier than 10:00 a.m. (Eastern Time), on the date the department

begins accepting applications and no later than 5:00 p.m. (Eastern

Time) on the last date upon which the applications are accepted.

Applications submitted after 5:00 p.m. Eastern Time on the final day of

the application period will be denied.

1 https://www.flrules.org/Gateway/View_notice.asp?id=19675982 (last visited

February 26, 2020).

11

The Amendment and section 381.896 were subject to extensive litigation, and

on October 5, 2018, the Second Judicial Circuit, in Florigrown, LLC, et al. v. Florida

Department of Health, Office of Marijuana Use, et al., Leon County Circuit Court

Case Number 2017-CA-2549, entered an order granting the plaintiff a temporary

injunction and ruling that section 381.986 was unconstitutional as it did not comply

with the Amendment. On July 9, 2019, the First District Court of Appeal in

Department of Health v. Florigrown, Case No. 1D18-4471, per curiam affirmed the

portion of the injunction that precluded the Department from enforcing the

provisions of section 381.986 found unconstitutional by the trial court but allowed

the Department “reasonable time” to exercise its regulatory duties under Amendment

2. On October 16, 2019, the Florida Supreme Court accepted discretionary

jurisdiction in Department of Health v. Florigrown, Case No. SC19-1464, and the

case is currently pending.

II. Proceedings involving O.F. Nelson & Sons Nursery, Inc.

After the temporary injunction was entered, on October 18, 2018, the

Appellant, O.F. Nelson & Sons Nursery Inc., submitted a “registration application”

to operate as an MMTC to the Department. (R. 36.) The letter accompanying the

purported application stated it was being submitted “[p]ursuant to the directive of the

Court” in Florigrown, and also pursuant to Rule 64-4.0022 of the Florida

2 Rule 64-4.002 was invalidated on August 6, 2018. See Louis Del Favero Orchids,

Inc. v. Dep’t of Health, Case No. 18-2838RP (DOAH August 6, 2018). The ALJ

12

Administrative Code and Form DH8013-OMMU-08/2017, “Application for Medical

Marijuana Treatment Center Registration.” (R. 36.) The letter also stated that

Appellant originally submitted its application in July 2015, but it was rejected as

untimely.3 (R. 36.) A check in the amount of $60,830.00 was enclosed with the

purported application. (R. 36.)

On March 4, 2019, the Appellant notified the Department that it intended to

rely on the default licensure provision of section 120.60(1), Florida Statutes. (R. 4.)

On March 5, 2019, the Department informed the Appellant that it was not

accepting applications for MMTC registration at the time the purported application

was submitted and that the Office of Medical Marijuana Use would publish the

application in the Florida Administrative Register when the application window was

opened. (R. 13.) The Department also informed the Appellant that proposed Rule

64-4.002, Florida Administrative Code, had been challenged, it was not in effect, and

any attempt to gain licensure pursuant to it was not valid. (R. 13.)

found that the Rule was an invalid exercise of delegated authority. Id. On March 12,

2019, the First District Court of Appeal dismissed the appeal pursuant to Florida

Rule of Appellate Procedure 9.350(b), which governs voluntary dismissals. See

Mecca Farms, Inc. v. Dep’t of Health, Louis Del Favero Orchids, Inc., Case No.

1D18-3761 (Fla. 1st DCA 2019).

3 In the letter, the Appellant argued that it is in the same legal posture as Edward

Miller & Son, Inc. v. Dep’t of Health, Case No. 2016-CA-0700 (Leon Cty. Ct. 2019).

However, that case was closed after summary judgment was granted in favor of the

Department. Id. (finding that the plaintiff was not entitled to MMTC licensure

because the plaintiff submitted its DO application untimely, it did not exhaust

13

On March 27, 2019, the Appellant filed a Petition for Formal Administrative

Proceedings (Petition). (R. 6.) The Appellant stated in its Petition that it was

applying for registration pursuant to article X, section 29 of the Florida Constitution

and in compliance with Rule 64-4.002 and Form DH8013-OMMU-04/2018. (R. 9.)

The Appellant’s “general allegations” included: (1) the Department did not timely

promulgate regulations for MMTC licensure; (2) the Department did not timely

license MMTCs; (3) the Appellant meets all requirements for licensure; (4) the

default licensure provision of section 120.60 applies in this case; (5) the Appellant

should have been issued a licensure in 2015, as its denial at that time was based on

an invalid rule. (R. 11.) As the ultimate remedy, the Appellant sought prompt

issuance of a license. (R. 11.)

On June 28, 2019, the Department dismissed the Petition with prejudice. (R.

15.) The Department concluded the following. First, default licensure was not

applicable in this case because section 381.986(8) is a need-driven procedure with

competing entities vying for a finite number of licenses. (R. 18-19.) Second,

decisions regarding the constitutionality of a statute are the province of the courts

and not an executive agency. (R. 19.) Third, the appropriate means of compelling

compliance with the Amendment was through judicial review rather than

administrative agency action. (R. 19.) Fourth, any issues the Appellant raised

administrative remedies, and it lacked a vested interest in the matter as it was not

granted a DO license).

14

regarding the 2015 application were foreclosed by the doctrine of administrative

finality, as the application was properly rejected and denied as untimely. (R. 19-20.)

This timely appeal followed.

15

SUMMARY OF THE ARGUMENT

The Department’s Final Order should be affirmed for two reasons. First, the

default licensure provision in section 120.60(1), Florida Statutes, does not apply to

the circumstances of this case. Second, the Department properly found that the

Amendment provides that the appropriate means of compelling compliance is

through judicial review rather than administrative agency action.

The default licensure provision of section 120.60 cannot apply to this case for

four reasons. First, the Department was operating not as a state agency governed by

chapter 120, but instead as a constitutional entity whose authority was provided

exclusively by the Constitution. Second, the deemer provision cannot apply to need-

based licenses. Third, the deemer provision should not be used in cases where public

safety could be threatened. Fourth, even if chapter 120 applied, the Appellant’s

purported application was filed at a time when the Department was not accepting any

applications.

The Final Order should also be affirmed because there is no administrative

remedy available to force the Department to comply with the Amendment. The

Amendment specifically provides that “[i]f the Department . . . does not begin . . .

registering MMTCs within the time limits set in this section, any Florida citizen shall

have standing to seek judicial relief to compel compliance with the Department’s

constitutional duties.” Art. X, § 29(d)(3), Fla. Const. The Florida Supreme Court

has expressly recognized that circuit courts have the power, in all circumstances, to

16

consider constitutional issues. Here, the Appellant is challenging the Department’s

present implementation of the Amendment as unconstitutional. As such, the

appropriate forum for a question of the constitutionality of the Department’s actions

is the circuit court, as is properly reflected in the language of the Amendment.

Finally, mandamus is an inappropriate remedy in this case. Mandamus relief is

not available under the cause of action provided for in section 29(d)(3) of the

Amendment. Moreover, the Appellant has failed to show it has a clear legal right to

MMTC licensure, that the Department has an indisputable duty to act, or that there

are no other adequate remedies available. Therefore, a writ of mandamus is not

appropriate in this case.

17

ARGUMENT

I. The Department properly dismissed the Appellant’s Petition for Formal

Administrative Hearing.

A. Standard of review.

Judicial review of the Department’s Final Order is governed by section

120.68, Florida Statutes (2018). “Unless the court finds a ground for setting aside,

modifying, remanding, or ordering agency action or ancillary relief under a specified

provision of this section, it shall affirm the agency’s action.” § 120.68(8), Fla. Stat

(2018). The standard of review of an agency decision based upon an issue of law is

“whether the agency erroneously interpreted the law, and if so, whether a correct

interpretation compels a particular action.” Rosenzweig v. Dep’t of Transp., 979 So.

2d 1050, 1051 (Fla. 1st DCA 2008); see § 120.68(3), Fla. Stat. (2018). When an

agency has interpreted a statute or constitutional amendment, its interpretation is

subject to de novo review. W. Fla. Reg’l Med. Ctr., Inc. v. See, 79 So. 3d 1, 8 (Fla.

2012). Statutory language must be given its full effect and readings that render a

statute meaningless must be avoided. Bennett v. St. Vincent's Med. Ctr., Inc., 71 So.

3d 828, 838 (Fla. 2011).

The Department’s Final Order should be affirmed for two reasons. First, the

default licensure provision in section 120.60(1) does not apply to the circumstances

of this case. Second, the Department properly found that the Amendment provides

that the appropriate means of compelling compliance is through judicial review

18

rather than administrative agency action. The Department properly interpreted the

Amendment and applied it to the facts of this case. As such, this Court should affirm

the Final Order.

B. Merits.

i. Default licensure is not applicable to the circumstances of this case.

The Appellant argues that it should be granted a license under the default

licensure provision in section 120.60(1). Section 120.60(1) provides that:

An application for a license must be approved or denied within 90 days

after receipt of a completed application unless a shorter period of time

for agency action is provided by law. The 90-day time period is tolled

by the initiation of a proceeding under ss. 120.569 and 120.57. Any

application for a license which is not approved or denied within the 90-

day or shorter time period, within 15 days after conclusion of a public

hearing held on the application, or within 45 days after a recommended

order is submitted to the agency and the parties, whichever action and

timeframe is latest and applicable, is considered approved unless the

recommended order recommends that the agency deny the license.

Thus, under the statute, where an agency fails to act upon a license application

within 90 days, the application is deemed approved. This is known as the “deemer

provision.”

This provision cannot apply to this case for several reasons. First, the

Department was operating not as a state agency governed by chapter 120 but instead

as a constitutional entity whose authority was provided exclusively by the

Constitution. Second, the deemer provision cannot apply to need-based licenses.

Third, the deemer provision should not be used in cases where public safety could be

19

threatened. Fourth, even if chapter 120 applied, the Appellant’s purported

application was filed at a time when the Department was not accepting any

applications.

a. Chapter 120 does not apply to constitutional

claims.

The default licensure provision of section 120.60 cannot apply to this case

because the Appellant invoked the Department’s constitutional authority (R. 9), and

the Department, in denying MMTC licensure, was operating as an entity whose

authority was provided exclusively by the Constitution. Section 120.52(1), Florida

Statutes (2018), limits the definition of “agency” to persons or entities “acting

pursuant to powers other than those derived from the constitution.” Here, as even

the Appellant acknowledges (I.B. 20), the Department’s authority to license MMTC

providers is a power derived from the Florida Constitution, and as such, the

Department’s actions in doing so or not doing so could not qualify as agency action

under chapter 120. See also Decker v. Univ. of W. Fla., 85 So. 3d 571, 573 (Fla. 1st

DCA 2012) (holding that the action taken fell within the scope of authority vested in

the university by article IX, section 7 of the Florida Constitution and, therefore, was

not subject to chapter 120) (emphasis added). The statute did nothing more than

provide parameters and guidance for the Department’s exercise of this duty. Thus,

the statute was “consistent with” the amendment, but it did not confer any

independent authority to regulate MMTCs. Fla. Const. art. X, § 29. As such,

20

chapter 120, specifically the deemer provision, is inapplicable, and the Appellant

cannot claim entitlement to licensure by default.

b. The deemer provision does not apply to licenses

awarded based upon need.

The deemer provision cannot apply to need-based licenses. Doing so would

contravene basic principles of administrative fairness that provide for a comparative

hearing when multiple entities vie for need-based licenses. MMTC licenses are

awarded based upon a needs-based formula found in section 381.986. It would be

improper for the Department, or this Court, to ignore this statutory directive and

issue licenses under the deemer provision.

In Ashbacker Radio Corp. v. F.C.C., 326 U.S. 327 (1945), the United States

Supreme Court held that an agency generally may not license one party without

considering the applications of others for the same license. This principle

“constitutes a fundamental doctrine of fair play which administrative agencies must

diligently respect and courts must be ever alert to enforce.” Bio-Med. Applications

of Clearwater, Inc. v. Dep’t of Health & Rehab. Servs., 370 So. 2d 19, 23 (Fla. 2d

DCA 1979). Where a need is determined “in accordance with a quantitative standard

. . . a fixed pool of needed investments is thereby created,” and “[o]pposing

applicants necessarily become competitors for that fixed pool.” Id. The Ashbacker

doctrine commands the agency to “conduct a comparative hearing at which the

competing applications are considered simultaneously.” Id.

21

The Ashbacker doctrine has been applied in several agency licensure cases in

this state. For example, in Bio-Medical Applications of Clearwater, the court

determined that once the determination was made that there was a need for ten

kidney dialysis units or stations in a specific area, the granting of an application for

those ten units automatically decreased need by that number and “effectively

denie[d] another pending application to the extent of those ten units.” Id. at 23.

Accordingly, the court held it was material error to refuse to consolidate two

opposing applications to conduct a comparative hearing. Id. at 20.

Here, section 381.986 provides that MMTC licenses should only be issued

based upon need:

Within 6 months after the registration of 100,000 active qualified

patients in the medical marijuana use registry, the department shall

license four additional medical marijuana treatment centers that meet

the requirements of this section. Thereafter, the department shall license

four medical marijuana treatment centers within 6 months after the

registration of each additional 100,000 active qualified patients in the

medical marijuana use registry that meet the requirements of this

section.

§ 381.986(8)(a)4., Fla. Stat. (2018).

The Department, in accordance with Ashbacker, has implemented a

comparative review process in order to ensure that only the best and most qualified

applicants receive one of the limited number of available MMTC licenses. If this

Court were to find that the deemer provision applies to need-based licenses, it would

contravene the Ashbacker doctrine because the Department would be forced to

22

render licenses without consideration of other bona fide and timely-filed applications

for MMTC licensure. Providing an MMTC license to the Appellant pursuant to the

deemer provision would automatically exclude other applicants for consideration.

See Bio-Medical Applications of Clearwater, Inc., 370 So. 2d at 23. This would

violate the principles of administrative fairness that Ashbacker represents and pose a

threat to the citizens of Florida.

The Appellant argues that this Court’s decision in Naples Community

Hospital, Inc. v. Department of Health and Rehabilitative Services stands for the

proposition that default licensure can occur in a fixed pool. 463 So. 2d 375 (Fla. 1st

DCA 1985). In Naples, the circuit court denied the appellant’s motion to intervene

in a suit filed by another hospital to mandate the Department of Health and

Rehabilitative Services issue a certificate of need (CON) by default. Id. at 376. This

Court did not address whether a CON could be issued by default. Id. at 377-78.

Rather, this Court found that the appellant should be permitted to intervene in the

case because it had an interest in the question at the center of the litigation: whether a

CON could be issued by default. Id. This Court did not rule on the merits of that

question, nor did it provide any precedent on whether default licensure can occur in a

fixed pool. Interpreting this case to say this Court “implicitly recognizes” the right

to a default license in a fixed pool would be error. (I.B. 24.)

c. Courts have not granted licenses under the

deemer provision where public safety could be

harmed.

23

The specific facts of this case distinguish it from other cases in which courts

have found that the deemer provision applies. Applying this provision here would

lead to licenses being granted to applicants who may not meet the requirements in

the statute, Emergency Rule, and Constitutional Regulation, which could pose a

serious threat to the health and safety of the citizens of Florida. MMTCs have the

authority to cultivate and distribute marijuana intended for use by qualified patients

suffering from one or more debilitating medical conditions. Marijuana can pose a

danger to the public if abused, and it poses a significant danger to a vulnerable

patient population if cultivated, processed, and dispensed by unskilled or unqualified

MMTCs. A rigorous application process is essential to ensuring the safety of

qualified patients and others in Florida. In other cases where courts have found the

deemer provision in section 120.60(1) or a similar statute applied, there was no threat

to public health and safety. See Johnson v. Bd. of Architecture & Int. Design, Dep’t

of Bus. & Prof’l Regulation, 634 So. 2d 666, 667 (Fla. 1st DCA 1994) (finding the

deemer provision applied where the board failed to timely approve or deny the

applicant’s application for interior design licensure); Krakow v. Dep’t of Prof’l

Regulation, Bd. of Chiropractic Med., 586 So. 2d 1271, 1272-73 (Fla. 1st DCA

1991) (finding the deemer provision applied where the board failed to approve

24

applications for licensure by endorsement when the applicants had practiced safely4

for years); World Bank v. Lewis, 425 So. 2d 77 (Fla. 1st DCA 1982) (finding the

deemer provision applied where an application for a bank charter was not timely

approved or denied). In each of the cited cases, there was no danger posed to the

public by the granting of these licenses. Here, issuing licenses under the deemer

provision would pose serious risks to public health and safety. This Court should

avoid that perilous outcome.

d. Even if chapter 120 applied, there was no window

open for the acceptance of licensure applications.

Even assuming Appellant’s argument that chapter 120 somehow applies here,

there was no application window open at the time the Appellant submitted its

purported application to the Department.5 The Emergency Rule and Constitutional

Regulation 2-1.01 specifically and expressly provide that the Department will

publish notice to the public of when the Department will begin accepting

4 The ALJ found there was no threat to the public’s health and safety because the

applicants had prior experience practicing, and as such, this Court declined to make a

finding about whether the board could have imposed conditions on the licensure. Id.

at 1273, n. 1. Here, there is no debate about the fact that granting default licensure to

an unqualified applicant could pose a threat to the health and safety of the public. As

such, even if this Court were to find the deemer provision applies, it should remand

this case to the Department to impose conditions on the license to ensure the safety

of the public. See id.

5 Without citing to any case law, the Appellant states that this argument was waived

on appeal because it was not included in the Final Order’s conclusions of law. (I.B

. 17.) The Department is not the appealing party in this case, and, as such, did not

have the duty to preserve issues for appeal.

25

applications along with the deadline to submit applications for registration as an

MMTC.

The Emergency Rule provides that:

(4) The department shall publish in the Florida Administrative Register

and on its website the date upon which the department will begin

accepting applications and the deadline to receive all applications.

Applications and all required exhibits and supporting documents shall

be hand delivered to the Department of Health at 4052 Bald Cypress

Way in Tallahassee, Florida, during normal business hours, but no

earlier than 10:00 a.m. (Eastern Time), on the date the department

begins accepting applications and no later than 5:00 p.m. (Eastern Time)

on the last date upon which the applications are accepted. Applications

submitted after 5:00 p.m. Eastern Time on the final day of the

application period will be denied.

Fla. Admin. Code R. 64ER17-2(4) (9/19/2017).

Using almost identical language, the Constitutional Regulation provides:

The department shall publish in the Florida Administrative Register and

on its website the date upon which the department will begin accepting

applications and the deadline to receive all applications.

Dep’t of Health, Office of Medical Marijuana Use, Const. Reg. 2-1.01(4).

No such announcement had been made at the time the purported application

was submitted. Construing section 120.60(1) to apply when an agency expressly

advises on its website and the Florida Administrative Register that it is not currently

accepting applications for licensure would defy reason. Courts must interpret

statutes “so as to avoid an unreasonable or absurd result.” See Diaz v. Jones, 215 So.

3d 121, 122 (Fla. 1st DCA 2017). To interpret the regulations in this way would

permit anyone to submit an application to any agency for any license that may not

26

exist or may not be available and then seek a default license if the agency does not

approve or deny the application within the statutory timeframe, notwithstanding the

agency’s prior announcement that the application window is not open. This would

be an absurd result.

Moreover, even if chapter 120 applied, Appellant submitted an application

form pursuant to an invalid rule. Rule 64-4.002 was invalidated on August 6, 2018.

See Louis Del Favero Orchids, Inc. v. Dep’t of Health, Case No. 18-2838RP (DOAH

August 6, 2018) (finding that the Rule was an invalid exercise of delegated

authority). The application form used by the Appellant was the form included in the

invalidated rule. Thus, even if the Department had accepted the purported

application, it could not determine the validity of the application because it was on a

form that had been invalidated.

The Appellant argues that the Department cannot argue in these proceedings

that the purported application was deficient as to its timeliness because the

Department did not give the Appellant an opportunity to cure the defect. Section

120.569(2)(c), Florida Statutes (2018), provides that “[d]ismissal of a petition shall,

at least once, be without prejudice to petitioner’s filing a timely amended petition

curing the defect, unless it conclusively appears from the face of the petition that the

defect cannot be cured.”

27

Here, there were no errors or deficiencies in the purported application that

could be corrected as the Appellant did not have the ability to open the application

window. As such, the Department properly acted pursuant to section 120.569(2)(c).

Because chapter 120 did not apply under these circumstances and because no

window for filing applications was open, the Department properly dismissed the

Petition.

ii. The appropriate means of compelling compliance with the

Amendment is through judicial review rather than administrative

agency action.

The Appellant argues that it was entitled to a hearing under chapter 120

because its substantial rights were affected by the Department’s refusal to grant an

MMTC license to it. However, the Appellant cannot show a violation of due process

rights because there is no administrative remedy available to force the Department to

comply with the Amendment. Only the circuit courts have the authority to provide a

hearing on the issue central to the Appellant’s challenge: whether the Department

violated the Constitution.

The Amendment specifically provides that “[i]f the Department . . . does not

begin . . . registering MMTCs within the time limits set in this section, any Florida

citizen shall have standing to seek judicial relief to compel compliance with the

Department’s constitutional duties.” Art. X, § 29(d)(3), Fla. Const. The Florida

Supreme Court has “expressly recognized that circuit courts have the power, in all

circumstances, to consider constitutional issues.” Key Haven Associated Enter., Inc.

28

v. Bd. of Trs. of Internal Imp. Tr. Fund, 427 So. 2d 153, 156-57 (Fla. 1982) (citing to

Gulf Pines Mem’l Park, Inc., v. Oakland Mem’l Park, Inc., 361 So. 2d 695 (Fla.

1978)).

Here, the Appellant is ultimately challenging the constitutionality of the

Department’s decision to deny its purported application for licensure. As such, the

appropriate forum for a question of the constitutionality of the Department’s actions

is the circuit court, as is properly reflected in the language of the Amendment. The

Florida Supreme Court has found that where administrative proceedings cannot have

any effect on the constitutional issue to be presented to the court, “it is pointless to

require the parties to endure the time and expense of administrative proceedings.”

Key Haven, 427 So. 2d at 157 (quoting Gulf Pines, 361 So. 2d at 699). Whether the

Appellant’s substantial interests were affected is not relevant as chapter 120 cannot

apply here. Therefore, the Appellant cannot show that the Department violated its

due process rights by failing to hold a chapter 120 hearing.

iii. A writ of mandamus is an inappropriate remedy in this case.

The Appellant asks this Court to enter a writ of mandamus directing the

Department to immediately register it as an MMTC. This remedy is inappropriate.

Mandamus relief is not available for suits brought against the Department pursuant to

the Amendment. Moreover, the Appellant has failed to demonstrate it has a clear

legal right to MMTC licensure.

29

First, mandamus relief is not available under the cause of action provided

for in section 29(d)(3) of the Amendment. Section 381.986, Florida Statutes

(2018), specifically limits causes of action filed under the Amendment to those

seeking declaratory relief. § 381.986(8) n.2, Fla. Stat. (“As used in s. 29(d)(3),

Article X of the State Constitution, the term ... Judicial relief means an action for

declaratory judgment pursuant to chapter 86, Florida Statutes.”). Accordingly,

the Appellant is not entitled to a writ of mandamus.

Second, the Appellant has failed to demonstrate it has a clear legal right to

MMTC licensure. The law regarding mandamus relief is well-settled:

In order to be entitled to a writ of mandamus, the petitioner must

have a clear legal right to the requested relief, the respondent must

have an indisputable legal duty to perform the requested action, and

the petitioner must have no other adequate remedy available....

Mandamus is available only to enforce an established legal right, not

to establish that right.

Fla. Agency for Health Care Admin. v. Zuckerman Spaeder, LLP, 221 So. 3d 1260,

1263 (Fla. 1st DCA 2017) (citations omitted). The Appellant argues that because it

submitted a purported application that the Department did not act upon within 90

days, it has a “clear legal right to claim” a default MMTC license under section

120.60(1). (I.B. 29-30.) However, as shown above, the Appellant has failed to show

it has a right to default licensure pursuant to chapter 120.

Additionally, the Appellant’s contention that its application meets the

requirements of an invalid rule does not establish an unequivocal right to licensure.

30

In fact, they are seeking to establish that right in this proceeding. This is an

inappropriate use of mandamus. See Fla. League of Cities v. Smith, 607 So. 2d 397,

401 (Fla. 1992) (“Mandamus may not be used to establish the existence of such a

right, but only to enforce a right already clearly and certainly established in the

law.”). Here, there is no right to MMTC licensure. As such, mandamus is not

appropriate.

Further, there can be no clear, legal right to MMTC licensure because there are

so many disagreements that have yet to be settled regarding the law, including

whether chapter 120 applies, whether there was an open application window at the

time the purported applications were filed, whether notice was published, and, most

importantly, whether the applicants are even qualified to obtain the license.

Moreover, for mandamus to be appropriate, the Department must have an

indisputable legal duty to act. See Hatten v. State, 561 So. 2d 562, 563 (Fla.1990).

This is not the situation here. The Department has discretion in its duties in

determining whether the applicants meet the requirements that ensure the safety of

the patient population. For example, whether the products are safe for patient

consumption is an inherently discretionary and subjective decision to be made by the

Department. While the Department’s ultimate decision is based on objective facts, it

is within the Department’s discretion to accept or deny MMTC license applications

based on public safety requirements.

31

Finally, for mandamus to be appropriate, there must be no other adequate

remedy available to the petitioner. See Zuckerman Spaeder, LLP, 221 So. 3d at

1263. Here, as shown above, the proper remedy for the Appellant is found in a

declaratory judgment action filed in circuit court. See Key Haven, 427 So. 2d at 157;

see also El Conuco Nursery v. Dep’t of Health, Case No. 2018-CA-275 (Leon Cty.

Ct. 2018) (“Mandamus is not an appropriate remedy in this case because . . . Plaintiff

has other adequate remedies available.”).

Because the Appellant has failed to show it has a clear legal right to MMTC

licensure, that the Department has an indisputable duty to act, or that there are no

other adequate remedies available, a writ of mandamus is not appropriate in this

case.

32

CONCLUSION

Because the default licensure provision in section 120.60(1) does not apply to

the circumstances of this case, and because the Department properly found that the

Amendment provides that judicial review is the appropriate means of compelling

compliance, the Department requests this Court affirm the Final Order. The

Department further asks that this Court deny the Appellant’s request for a writ of

mandamus as the Appellant has failed to demonstrate it is entitled to this

extraordinary relief.

Respectfully submitted,

/s/ Sarah Young Hodges

Sarah Young Hodges

Chief Appellate Counsel

Fla. Bar No. 100448

Florida Department of Health

4052 Bald Cypress Way, Bin #C-65

Tallahassee, Florida 32399-3665 (850) 354-3367

(850) 245-4662 (fax)

Sarah.Hodges2@flhealth.gov

mqa.psuappeals@flhealth.gov

33

CERTIFICATE OF SERVICE

I certify that a copy of the foregoing has been furnished via electronic mail to

Robert O. Beasley, Esq., at rob@lawpensacola.com, and Jessica L. Scholl, Esq., at

jscholl@mhw-law.com, this 26th day of February 2020.

/s/ Sarah Young Hodges

Sarah Young Hodges

Chief Appellate Counsel

Fla. Bar No. 100448

34

CERTIFICATE OF FONT COMPLIANCE

I certify that the foregoing is prepared using Times New Roman 14-point font

in compliance with the font requirements of Rule 9.210(a)(2) of the Florida Rules of

Appellate Procedure.

/s Sarah Young Hodges

SARAH YOUNG HODGES

Chief Appellate Counsel

Fla. Bar No. 100448